LOOKING TO BUY OFF PLAN PROPERTY IN PORTUGAL?

Property in Portugal attracts huge foreign investments. Property for sale in Portugal does not lay restrictions on non-resident ownership and hence allows any number of foreign investments. This factor has created a great demand for property in Portugal. The prices simply keep soaring day after day. Portuguese mortgages contribute to the hike in foreign investment by rendering financial help to investors.

One can find all types of quality property from studios to grand villas for sale in Portugal. The number of investors buying property in Portugal keeps increasing year after year. Most non residents, especially the Europeans, wish to buy their second homes in places like Algarve, Costa Azul, Alentejo and Albufeira.

Both off plan and resale properties are in vast demand in Portugal. Off plan property refers to property that is only in plan and yet to be constructed. Off plan property in Portugal is developed by property developers who are direct vendors. An initial deposit has to be made before purchasing the property while the rest of the amount is paid as the construction progresses. Portuguese mortgages also help investors in this regard. On the other hand, resale property is a used property sold by a seller. In this case, there are no developers but only direct vendors.

Generally there are certain advantages in buying off plan property in Portugal. Some of them are:

• Off plan property in Portugal can be bought for the lowest market price.
• Amount is paid stage by stage as the construction progresses.
• The property is a new development built exactly according to the plan.
• It can be built with our choice of fitments, colors and flooring.
• When the property is completed its market value will be 15% to 60% higher.
• It is good long term investment.

Since all off plan property in Portugal are bought before construction, the history and credential of the developers are important. It is always advisable to have a legal representative or a lawyer for taking care of the proceedings while buying property abroad. He can also run a background check on the property, check for the authentication of ownership documents. Professional help from structural engineers can also be obtained to oversee the construction.

Portuguese mortgages are made easily available for investors who wish to buy property in Portugal. Up to 80% of the property value can be claimed as mortgage. However, this percentage might differ for a resident and a non resident of Portugal.

Buy to let property in Portugal is term used to describe properties that are purchased only to be rented out for a fixed rental income. A number of non-residents invest on property in Portugal because of the scenic beauty of the country, its climate and location. They prefer buy to let property in Portugal as it serves dual purposes – as a second home and a property that gives good return on investment.

Advantages of buy to let property in Portugal:

• Regular source of rental income.
• Smart long term investment
• Used as holiday homes.
• Saves lot of tax.

These are some of the reasons why property in Portugal is always in high demand. They bring high return on investment. Added to this, the Portuguese mortgages make investment on property in Portugal simple and easy by rendering financial help to investors. However, one has to be careful in selecting the location and the type of property one wishes to buy. Many factors have to be considered while buying property abroad. Not all property will fetch good income. Location plays an important role in our return on investments. So, it is necessary to invest on properties which would give good ROI.

MORTGAGES FOR YOUR PROPERTY IN PORTUGAL

Buying property in Portugal can be made simpler by claiming a Portugal mortgage. One can claim up to 80% of the value estimated to buy property in Portugal. Mortgage in Portugal is available from 5 to 30 years of time. The mortgage is available in Euros and all other major currencies. The bank’s surveyor will officially evaluate the property for sale. Though every other regulation is the same for both foreign and local residents with regards to a Portugal mortgage, loan requirements are different for Portuguese and foreign investors. The lending criteria and the mortgage packages available for local residents and foreigners vary from each other. For a non-resident, the maximum loan that can be availed for a period up to 30 years is 80% while it is 90% for a resident.


Mortgage is available to investors who wish to invest on properties in Portugal. Portugal Mortgage is relatively easy to claim, for those who have a Portuguese residency card, tax code, bank account, proof of regular income, good credit rating. These loans are available for purchasing any kind of property like small houses, studios and large villas. For buying a property ‘off plan’, mortgage can be raised only after its completion. One can apply and keep the offer ready in writing. However, valuation and fund transfer will not be made until the property is completed and inspected for valuation.

It is advisable to engage a legal advisor prior to signing the contract for buying property in Portugal. It is essential to check whether the property is free of debt and the price is reasonable. The buyer can also give his lawyer Power of Attorney to sign on behalf of him if he is unable to be in Portugal during the process. Lawyers generally charge 1% - 2% of the property value as processing fees. And it is not advisable to have the seller’s lawyer for your purposes. It is difficult to make any changes in the cost of the Portuguese mortgage after the completion of sanction. Hence it is advisable to rise the maximum funding one requires in the beginning stage itself as changes at a later stage might not be possible or will be very costly.

Necessary requirements for Portugal mortgage:

• Proof of income. Should be sufficient enough to pay the mortgage.
• Valid Passport and Identity Card.
• Pay slip for employees or two years account along with the tax declaration.
• 6 months Personal Bank statement.
• Proof of address.
• Signed contract (if available)
• Detailed address of the property to be purchased.

Final Process:

• After the mortgage request is made, one will receive formal approval provided the applicant is eligible and subject to valuation.
• The Bank’s surveyor evaluates the property value.
• The buyer’s lawyer is provided with registration documents.
• Funds approved by the bank will be released on the agreed date.

Portugal mortgage is a simple and easier business transaction which helps buying property in Portugal an easier one. The interest rates are nominal and the fund sanctioned encourages prospective foreigners to buy property in Portugal. Another added advantage is that most of the Portuguese banks have branches in America and European countries which can arrange mortgage in major currencies.